Correlation Between Spire Healthcare and Iron Mountain

Can any of the company-specific risk be diversified away by investing in both Spire Healthcare and Iron Mountain at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Spire Healthcare and Iron Mountain into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Spire Healthcare Group and Iron Mountain, you can compare the effects of market volatilities on Spire Healthcare and Iron Mountain and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Spire Healthcare with a short position of Iron Mountain. Check out your portfolio center. Please also check ongoing floating volatility patterns of Spire Healthcare and Iron Mountain.

Diversification Opportunities for Spire Healthcare and Iron Mountain

0.69

Correlation Coefficient

Spire Healthcare  Iron Mountain

Poor diversification

The 3 months correlation between Spire and Iron is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Spire Healthcare Group and Iron Mountain in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Iron Mountain and Spire Healthcare is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Spire Healthcare Group are associated (or correlated) with Iron Mountain. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Iron Mountain has no effect on the direction of Spire Healthcare i.e., Spire Healthcare and Iron Mountain go up and down completely randomly.

Pair Corralation between Spire Healthcare and Iron Mountain

Assuming the 90 days trading horizon Spire Healthcare Group is expected to generate 0.94 times more return on investment than Iron Mountain. However, Spire Healthcare Group is 1.06 times less risky than Iron Mountain. It trades about 0.25 of its potential returns per unit of risk. Iron Mountain is currently generating about 0.15 per unit of risk. If you would invest  18,284  in Spire Healthcare Group on April 25, 2025 and sell it today you would earn a total of  4,416  from holding Spire Healthcare Group or generate 24.15% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.41%
Values	Daily Returns

Spire Healthcare Group  vs.  Iron Mountain

Spire Healthcare

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Spire Healthcare Group are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical and fundamental indicators, Spire Healthcare exhibited solid returns over the last few months and may actually be approaching a breakup point.

Iron Mountain

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Iron Mountain are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Iron Mountain unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Spire Healthcare and Iron Mountain

The main advantage of trading using opposite Spire Healthcare and Iron Mountain positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Spire Healthcare position performs unexpectedly, Iron Mountain can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Iron Mountain will offset losses from the drop in Iron Mountain's long position.

The idea behind Spire Healthcare Group and Iron Mountain pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.